The Chief of STMicroelectronics NV says perspectives improve due to chip demand

Currently the chip manufacturer STMicroelectronics NV gains about a quarter of its sales in Europe. The company announced that most customers in the region are starting to expect improvement in the economy after months of gloomy prospects.

The head of STMicroelectronics NV in Europe, Africa and the Middle-East – Mr. Paul Grimme – said in an interview, which was cited by Bloomberg: “What we’re seeing is a stabilization of the marketplace in the euro zone. Some of our customers expect slight improvement – Europe is moving to a stable, slight growth period.”

At the Mobile World Congress in Barcelona, Mr. Grimme also explained that Germany is leading the way to improvement in the single currency blocs economy. He also shared that the outlook of France is the most negative in the region.

Last month STMicroelectronics NV projected a faster growth than its addressable market in 2014. The company also expects to return to profit in the current year due to the fact that it wins share from its competitors such as Infineon Technologies AG in Germany and Qualcomm Inc. in the U.S. As Bloomberg reported, the demand for chips is usually regarded as an advanced indicator of economic activity.

Yesterday the European Commission announced that the the Euro zones economy is expected to continue to fall behind the U.S. and China over 2014 and 2015 due to high levels of unemployment and debts, which impair its recovery. Nevertheless, Europe is slowly improving from the consequences of the debt crisis.

STMicroelectronics NVs Mr. Grimme said for Bloomberg: “Industrial and automobile are big markets for us in Europe, so this is good news. The question today is whether the trend is going to continue – Europe needs consumer confidence to make sure of that.”

Currently, the company has become more focused on cars, smartphones and industrial machinery.

The revenue of STMicroelectronics decreased by about 5% in 2013 and reached 8.08 billion dollars.

STMicroelectronics NV rose by 3.26% by 16:54 GMT in Paris to trade at 6.3970 euros, raising the companys market value to 5.82 billion euros.